The Ultimate Uniform Debt Management Services Act Quiz

Being in over your head in debt can be overwhelming. Rest assured that the American government is looking out for your best interests. The Uniform Debt Management Services Act is intended to protect you as a consumer when seeking debt management services. Take this quiz and educate yourself about this important law.

The previous federal debt management law was insufficient to handle the economic crisis.

Debt management law varied too much from state to state.

Prior to the Uniform Debt Management Services Act, each individual state was responsible for implementing debt management law. This resulted in two many inconsistencies from state to state.

Question 3 of 10

The Uniform Debt Management Services Act:

overrules previous state law

guides states on how to handle debt management

The Uniform Debt Management Services Act simply guides individual states on how to handle debt management, with the goal of maintaining some uniformity across the country.

serves as a uniform state law across the country

Question 4 of 10

What was a problem with credit counseling agencies prior to the Uniform Debt Management Services Act?

excessive cost to the consumer

credit counseling deception and dishonesty

both of the above

Prior to the act, there were many dishonest credit counseling agencies that took advantage of consumers. They tended to be deceptive and dishonest regarding the best debt options for consumers and they instituted excessively high interest rates.

Question 5 of 10

According to the Uniform Debt Management Services Act, all credit counseling agencies must submit to the state government:

proof of non-profit status (if applicable)

salary information of the five highest paid employees

both of the above

To decrease dishonest credit counseling agencies, the act requires that all credit counseling agencies submit proof of non-profit status (if applicable), salary information of the five highest paid employees and a record of debt counseling services for the previous five years.

Question 6 of 10

The Uniform Debt Management Services Act safeguards consumer rights. According to the act, all credit counseling agencies must provide their customers with:

a list of goods and services offered

financial education

both of the above

Consumers' rights are protected under this act, which requires credit counseling agencies to provide consumers with a list of goods and services offered and to provide consumers with financial education.

Question 7 of 10

Credit counseling fees are also regulated under the Uniform Debt Management Services Act. According to the act, credit counseling agencies cannot charge more than ___________ in set up fees.

50

Dishonest, for-profit credit counseling agencies used to charge outrageous fees. Now, under the act, credit agencies can only charge a maximum of $50 for set-up fees.

100

200

Question 8 of 10

How many non-profit credit counseling agencies lost their tax exempt status after the American Internal Revenue Service reviewed their financial records?

10 percent

25 percent

50 percent

Many so-called non-profit credit counseling agencies claimed high profits and had high-paid employees. After the American Internal Revenue Service reviewed the financial records of these credit counseling agencies, 50 percent lost their tax exempt status!

Question 9 of 10

There are several prohibitions under the Uniform Debt Management Services Act. According to the act, what are credit counseling agencies forbidden to do?

perform legal services

Under the act, credit counseling agencies are not entitled to perform legal services, give employees bonuses or commission or buy the consumer's debt, among other things.

suggest bankruptcy

both of the above

Question 10 of 10

Although the Uniform Debt Management Services Act was completed in 2005, only handful of states adopted the act by 2008. How many states adopted the act by 2008?

8 states

Delaware was the fist state to adopt the act in 2007, followed by Rhode Island, Utah, Colorado, Hawaii, Illinois, Missouri and Wisconsin.